The Orange Economy

How to promote Creative Entrepreneurship in the Caribbean?

By Dr. Keith Nurse, World Trade Organization Chair at the University of West Indies

Caribbean economies have a narrow and declining industrial base and an expanding debt overhang in part due to deteriorating export competitiveness. As such there is an increasing view among Caribbean governments and regional agencies that the creative industries can be an engine for economic growth and a mechanism for diversifying economies and improving global competitiveness. On account of this there is a greater need to understand the trajectory of the creative or orange economy and to identify the ways that small economies can benefit from the wider synergistic effects of the creative economy and move up global value chains. As such the aim of this paper is to assess how the small developing states of the Caribbean can maximize on the potential of the creative or orange economy by fostering policy innovation, generating new business models and promoting creative entrepreneurship.

The creative sector is generally understood to encompass the creative arts and the creative industries. However, the impact of the sector has widened over time to generate what is described as the creative economy. The creative economy is a critical aspect of these trends given that creative content accounts for a significant share of e-commerce and the content on the Internet. What is observed is that the creative sector plays a vital role in differentiating and enhancing the value proposition in multiple sectors (e.g. manufacturing, tourism, telecoms) that are increasingly reliant on the use of creative content and creative experiences to generate growth in global markets. The creative sector is a major growth pole in the digital economy as exemplified by the shift towards a post-industrial economy where personal, recreational, and audiovisual services have expanded as a share of the expenses of the average household and as a share of the economy. The growth of the digital creative sector is accounted for by rapid technoeconomic change in products, distribution and marketing (e.g., e-books, iPods, iTunes, Amazon, Google, NetFlix, Spotify), the increasing commercialization of intellectual property in the digital world (e.g., digital rights management), the growth of social networking (e.g. Facebook, YouTube, Twitter, Instagram, Snapchat) and through the synergies forged by value enhancing activities (e.g. cultural tourism, intellectual property, destination branding, nation branding) and the convergence of content, media and telecoms (e.g. the Internet, mobile and ecommerce).

The industry faces numerous barriers to local and global market participation, including

lack of production facilities, poor market organization, inadequate rules and regulations, limited understanding of global markets, the problem of language, and lack of bargaining power and commercial relationships. Hence, for example, in the burgeoning audiovisual sector the majority of local filmmakers and producers are isolated and left to operate in marginal economic areas such as micro and informal enterprises. Their problems are magnified by the lack of access to networks that can help them compete in the global film business. The key recommendations to address these challenges are:

Improved access to finance should be twinned with access to market and access to digital platforms.

A key element of the intervention framework that can be promoted relates to the creation of enabling institutions to facilitate the growth and industrial upgrading of the sector. It is also important to promote cross-sectoral linkages as the creative industries have multiple markets and sources of income, many of which intersect with ICTs, manufacturing and tourism. The key lesson is that most of institutions targeting the creative sector operate in silos and have limited linkages with wider market penetration initiatives. As such there tends to be an absence of end-to-end business and trade support. This suggests that the solution is more than access to market. From this perspective there is a critical role for upscaling the creative industries once integrated support mechanisms are employed. The following diagram describes a trade and financing governance framework that is demand-driven and entrepreneurial in focus. It allows for start-ups, clusters, incubators, accelerators right through to market entry programmes that are linked to innovative financing mechanisms (e.g. crowdfunding, angel investing, debt and equity financing, trade financing and intellectual property value capture) and a wide array of policy support measures such as diaspora engagement, destination branding, trade and export facilitation, investment policy and human resource development. The objective is to make creative entrepreneurs and their works more visible and accessible to the wider markets, potential clients/sponsors/investors and policy makers.

This also requires involving the establishment of proactive mechanisms such as funding for start-ups, innovation labs, market incubators, cluster development and market development programmes. These mechanisms can play an important role in the development of entrepreneurial skills among industry participants, encourage experimentation with new ideas, techniques and media, and facilitate capacity development particularly among young entrepreneurs who can overcome their creative or intellectual isolation through networking, mentorship and peer-to-peer-coaching. From a trade facilitation standpoint business support organizations play a critical role in minimizing some of the risk associated with the creative sector by offering a range of trade and financing services that could include market development grants, export assistance grants, business competitions as well as reimbursable grants. In conclusion, the expansive range of trade and industrial policy issues affecting creative industries highlights the need for a strategic export-oriented policy framework.

Dr. Keith Nurse is a Senior Fellow, Sir Arthur Lewis Institute and World Trade Organization Chair at the University of West Indies. This blog stems from his presentation at The Orange Economy Webinar, Wednesday, August 30, 2017 organized by Creative Nassau, in collaboration with The Central Bank of The Bahamas and the Inter-American Development Bank.

Related

1 Comment

sally radford

Creative economics -CARICOM is doomed since it has not applied technology to withstand hurricanes , volcanoes and earthquakes. Resources are squandered on bling, carnival, vice, fashion, trivia, fatuous entertainment and sport but not on drains, water butts and management of wetlands. CARICOM needs to act, focus on priorities for progress and eschew flag-waving bureaucracy and dependence on aid from EU while demanding reparations for history. The AU offered repatriation since 2010 to ancestral homelands free from hurricanes, volcanoes and earthquakes to which Irma victims can evacuate to start creative lives, in a continent rich in resources which ignores foreign disasters and which can redeem itself through such reparation for selling its children into slavery. All building should end so fragile islands, islets, sandbars, lagoons and beaches can recover by forces of nature that built them. Hurricane victims are looting and shooting so they invest in guns but not roofs and food storage. While EU aid arrives by the planeload and ship load ,the UK has 271000 homeless but voted £32 million, a massive sum from British taxpayers for relief. This should not rebuild structures in the path of ferocious storms..The Bahamas, with the region's highest GDP never sends aid to the region. As the spectre of homelessness stalks the land, companies in Trinidad, where millions are invested in the steeldrum, are raising funds for Irma victims and Trinidad sent a helicopter to Antigua but refused a boat to rescue squatters in floods from Bret who face caiman and snakes in lagoons by OILFIELDS POURING BILLIONS OF PETRODOLLARS INTO STATE COFFERS. Among those who also suffered floods from Don, is the desperate Chance-Ali family of 7 left in a swamp infested with deadly caiman and snakes after their 1-room shack was wrecked in Sunrees Road, Penal. The children are not in school. They must be given priority now, before Irma victims. Housing is a basic right. To help, Please Contact Councillor Shanty Boodram 218 A S.S. Erin Road, Debe Tel: 1 (868) 647-0961/7012/2092 Email: contactus@pdrctt.com Website: www.pdrctt.com I donated a dinghy to PDRC to rescue flood victims, using my pension. UK Foreign Secretary Johnson, troops and police joined RFA Mounts Bay providing relief to British islands. The Royal Navy flagship HMS Ocean is bringing helicopters and other vital items. Aid will only benefit rulers in a region notorious for fraud, subsaharan standards and poor governance. We must end this obscene madness and misuse of our taxes to rebuild resorts.. Racial envy is rife in .corrupt CARICOM. Storms are blamed on climate change which occurs in cycles throughout millenia of earth history. . Annual hurricanes bring rain for 6 months, but CARICOM governments are incompetent and individualistic, lacking priorities, ignoring corrosive crime, Their campaign to raise cash will be diverted from the victims. Fear is rife as a result of corrosive crime and daily violence, rape, robbery, slaughter especially of women. Progress is stymied by discrimination against foreign investors, entrepreneurs and business.. USD rules in the airport in Antigua, which refuses currency of Trinidad & Tobago, the cuisine of which is on the menu of airport restaurants.

Useful Links

Disclaimer

The views expressed in this blog are those of the author and do not necessarily reflect the views of the Inter-American Development Bank, its Management, its Board of Executive Directors or its member Governments.